Household interest in 5G gathers pace

Cellular IoT to drive mobile SIOs to 60M by 2023

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SYDNEY, AUSTRALIA – The Australian mobile services market is expected to impact fixed line services as soon as next year with new 5G services becoming available, according to new research from emerging technology analyst firm Telsyte.

The Telsyte Australian Mobile Services Market Study FY2018 found there is growing interest amongst consumers for home Internet services based on 5G technologies, with 1 in 3 households interested in subscribing to such services.

This equates to around three million households potentially using 5G either as a primary or additional access technology as early as 2021.

According to Telsyte, around 15 per cent of Australian households (1.4M households) are currently mobile only. Telsyte research shows 41 per cent of Australians aged 16 to 34 are interested in subscribing to 5G services for the home, given higher awareness and higher levels of living in rental accommodation.

Telsyte’s research found interest in 5G broadband services remains the highest amongst those that are currently using mobile broadband (43%), indicating 5G might be an up-sell opportunity to mobile-only consumers.

5G broadband services are expected to be available in metro areas as early as next year from both Telstra and Optus; however, the potential demand of these services is still subject to the cost of 5G Internet plans and contractual obligations carriers have with nbn.

Extending the fixed line Internet

Telsyte research has found that 5G presents opportunities for mobile service providers, but also fixed line service providers including nbn.

Telsyte predicts that the short-term opportunity for carriers will be with dual-mode routers that utilise both fixed line nbn connections and 5G to provide a hybrid experience, building on the approach already used by carriers such as Telstra and Vodafone.

Telsyte believes limited spectrum, massively growing data usage, and potentially high costs for consumers will limit the number of households that might look to go mobile only.

This might give rise to more dual-mode routers which will utilise both fixed and wireless networks, using software to manage traffic across either network, having redundancy as well as the ability for lower latency and high burst speeds.

“Fixed and wireless technologies such as 5G can work hand-in-hand,” Telsyte Senior Analyst Alvin Lee says.

“Most consumers don’t want to think about what technologies are behind their Internet access, they just want it to be fast, good value and work seamlessly” Lee says.

For nbn, Telsyte believes there is an opportunity to update existing non-metro fixed wireless with 5G as well as using it as an option for upgrading the FTTN network in the future.

5G set to add to mobile mix

When it becomes available, 5G is expected to be an important mobile service provider (MSP) selection criteria. Telsyte research shows 37 per cent of Australian mobile users will see 5G as important when choosing their MSP, especially if it is not expected to be available from all MSPs initially.

This rate is higher amongst those planning to switch providers (66%). Telsyte estimates 32 per cent of mobile SIOs will be 5G by the end of June 2023 (FY23).

Nearly one third (31%) of smartphone owners are showing signs of holding off buying a new smartphone until 5G models become available.

5G “mobile” services are expected to be available either late 2019 or early 2020 depending on carrier rollouts.

M2M and cellular IoT to boost SIOs

The Australian mobile services market grew by over 650,000 new SIOs (Services in Operation) in the measured 6 months to June 2018, reaching 34.9 million at the end of June 2018.

The total 6-month net add in June 2018 was the highest during the June period for the past 8 years as more services were connected.

The lion’s share of growth continued to come from handsets (70%); however, Telsyte research shows the total 6-month net adds of M2M and cellular IoT connections have doubled compared to the same period 12 months ago.

Telsyte expects the increasing focus on cellular IoT consumer and business applications and continued NB-IoT network rollouts will underpin future growth, with enterprise applications taking the early lead.

Telsyte forecasts M2M and cellular IoT connections will reach 25 million by 2023, driven by the explosion of cellular IoT as new consumer and business applications becoming more widely adopted.

Cellular IoT applications include location tracking tags for asset tracking and IoT applications for transport, utilities, manufacturing, mining, agriculture and other industries.

A large volume of cellular IoT applications are expected to be based on NB-IoT technology as the low power, low data-rate and low-cost advantages are suitable for many applications that require power longevity rather than high data throughput.

For further information on the report or media enquiries contact:

Alvin Lee
Senior Analyst
Tel: +61 2 9235 5890
Email: alee@telsyte.com.au

Foad Fadaghi
Managing Director
Tel: +61 2 9235 5851
Email: ffadaghi@telsyte.com.au

  • Editors please note, Telsyte will not publicly supply individual service provider estimates.

The Telsyte Australian Mobile Services Market Study FY2018 is a comprehensive study which provides subscribers with:

  • Market sizing and forecasts of the Australian mobile services market and sub segments

  • Analysis of market share and carrier performance

  • MNVO market share estimates

  • End-user trends and consumer expectations

  • Market trends and developments

  • Mobile services market KPIs

In preparing this study, Telsyte used:

  • An online survey conducted in July 2018 with a representative sample of 1,047 respondents, 16 years and older.

  • An online survey conducted in November 2017 with a representative sample of 1,162 respondents, 16 years and older.

  • Interviews conducted with executives from carriers, mobile service providers, device manufacturers, and channel partners.

  • Financial reports released by service providers.

  • On-going monitoring of local and global market and vendor trends.

About Telsyte

Telsyte is Australia’s leading emerging technology analyst firm. Telsyte analysts deliver market research, insights and advisory into enterprise and consumer technologies. Telsyte is an independent business unit of DXC.technology. For more information visit www.telsyte.com.au

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